4/24/2012

Ed Morrissey is entirely correct about the anticlimactic nature of these contests. Indeed, it is doubly so when you consider that Pennsylvania is the only state in this group the GOP has a reasonable shot to win in November. However, it is worth reminding ourselves the degree to which the RNC’s calendar drives perceptions of the primaries. Had Rick Santorum done a little better in March (and his daughter had not fallen ill), tonight’s results would be hyped by the cable nets, and the likely results trumpeted at Romney regaining momentum. Instead, everyone yawns, and the spin probably will focus on spurious voter turnout numbers.

Y’all know I’m hoping for an upset, but I’m realistic in my expectations. Romney will sweep. The question to me at this point (as to the direction of the party) is who pulls second. And I’m hoping that Paul pulls a good percentage.

I know that I’m probably the only one here rooting for Paul, but I’m rootin nonetheless.

There are lots of things I’d like that Romney won’t do, but all he really has to do is to get us out of this mess and get rid of the socialism of the last two presidents and we can worry about the rest later as the Democrats spend 3 decades in the wilderness.

Parachuting in for a moment to report that when I went to vote at 1:00 pm, in my extremely D district in Brooklyn, the place was practically empty; there were about six poll workers plus a policeman, and only two voters including me. In my “election district” (the smallest subdivision of the roll) I was voter #6.

NY allocates most of its delegates by Congressional District. This means that since there are very few registered Republicans in my district (even those who regularly vote R usually register as D so they can vote in the D primaries, since for most offices those are the real election), my vote carries far more weight than most those cast in less heavily D districts, let alone in R ones. I can’t see how this is at all fair, but it is the fact, so there was a decent chance that my vote might actually make a difference, and thus I had to think about it. I wanted to vote for Not-Romney, so as to increase the number of Not-Romney delegates at the convention, both in the desperate hope of a brokered convention and so that Romney get slightly less cocky than he might.

To maximise the chance of my vote tilting the balance in the district against Romney, though, I had to guess which Not-Romney candidate my fellow Rs in this district would support. Since we’re demographically quite different from most Rs, the general polls are no help. I took a guess on Paul, so that’s how I voted. Since I am confident that there is no way Paul will actually get the nomination, I could afford to ignore all the reasons why he can’t be allowed to be president, primarily his apparent senility and his dangerously naive foreign policy; at least I didn’t have to hold my nose to vote for him. Once the results come in I can see whether I guessed right about the other Rs in my district.

Karl, it’s also worth noting that there seems to be a regional pattern to candidate preference, and most of these states are squarely within Romney’s regional heartland. These contests would be anticlimax no matter what, I think, to anyone who was paying attention.

What’s not to like about a guy who is this narcissistic? From a book called “The Obamas” by Jodi Kantor:

“Obama had always had a high estimation of his ability to cast and run his operation. When David Plouffe, his campaign manager, first interviewed for a job with him in 2006, the senator gave him a warning: “I think I could probably do every job on the campaign better than the people I’ll hire to do it,” he said. “It’s hard to give up control when that’s all I’ve known.” Obama said nearly the same thing to Patrick Gaspard, whom he hired to be the campaign’s political director. “I think I’m a better speechwriter than my speechwriters,” Obama told him. I know more about policies on any particular issue than my policy directors. And I’ll tell you right now that I’m gonna think I’m a better political director than my political director.'”

I totally agree about the regionalism. But that’s part of my point about the calendar. If you had swapped the primaries in March and April, it would look like a totally different race. The RNC figured Romney was most likely, but wanted to stretch out the process in hopes of party-building, so they adjusted the calendar and the rules from 2008.

I have never seen an election I think with so few votes cast, even a school board election.

In one polling place with 9 Election districts (3 of them small) there were altogether 15 votes cast by the end of the day. By 2:30 there had been 7 votes cast, two of them by pollworkers.

There is heavy Democratic registration, but there still should have been about 200 to 300 or 400 names in all the books. I think you could expect some 2,000 votes cast there in November in a presidential election year. Or maybe that would be 1,500.

One man came in expecting to vote in the Democratic primary for mayor which is next year. He heard something on he radio which he didn’t completely catch and thought this also might be included.

One man changed his registration to Republican (from no party) but of course he couldn’t vote. Changes in party registration in New York only take effect after the next November election. It’s not like Pennsylvania. He said “why am I not surprised” he said it is like you get punished for voting (because had he never registered before, then he could have enrolled in the Republican Party this year)

Later on someone came in who said he had it done it before November, but he was not in the book. he was offered an affidavit ballot but said he wold vote in November. here are two primary elections before then!

13, 27 28. Can’t imagine being that lonely. Had a house once in a solidly Democratic district in Milwaukee, but lived three doors from the assemblywoman and was good friends with her nephew. Her bro was police chief.

MN is lost this time out, but Governor Prozac only won by 7000. A living, breathing candidate and it could have been done.

That said, the really-delayed-change-of-party rules in NY seem bizarre to me.

Not to me. They prevent opportunistic party-switching (aka Operation Chaos). If you want to vote in a primary you should at least have declared your allegiance well in advance, before you could know who the candidates would be.

I was unaware that you were in NY. We should meet for coffee sometime.

The old CDs will be used for apportioning delegates to the Republican national convention. The winner in each Congressional district gets 3 delegates. Total 29×3 = 87. Another 34 are assigned to the winner of the state if he gets over 50%, or otherwise split proportionally. 3 more delegates are party officials.

Newt Gingrich was pinning his hopes on carrying Delaware, or coming close. Delaware is a winner take all state with 17 delegates. He complained about Romney getting set to deliver a speech in New Hampshire.

Santorum could have voided votes cast for him in New York, but didn’t.

Polls are pretty much useless for an election like this.

The person who says he registered or switched before November came in with a card from the Board of Elections, but I think that was for the March 20 special election for State Senate. They didn’t mail them out for this election, even to Republicans.

Milhouse – I was watching google elections and those were the *first results* reported in Queens and Bronx county, so they would show up as a total for the county with the note (1/xxx) precincts reporting.

Once we got beyond that, I was no longer able to get precinct level breakdowns.

Karl: apropos of earlier threads, here is Jay Cost’s assessment that the election will come down to the 10% of voters who, in his words, are between the 45 yard lines. In other words, if Romney wants to win, he will NOT play to the partisans.

FWIW-
Here in Philly just about everyone is registered Democrat, otherwise you can’t vote in the Democratic primaries, which are the only elections that usually count for Philadelphia and state offices for Philadelphia. My wife went out of her way to switch to Repub so she could vote in the primary…
We did not realize yesterday was the primary until it was mentioned on the local AM “news radio” station about 1 pm, at which point my wife was preparing to go to work.

Maybe other parts of PA were more aware, but in Philly it was “what election”?

Good point.
I’d also mention that Rick Santorum and Ron Paul couldn’t even win enough votes of registered Republicans.

So, I don’t see why their supporters believe that an unabashed conservative platform is going to magically seduce “independents,” “centrists,” “moderates,” and “disappointed Democrats” in the general election if Mitt were to run as Barry Goldwater Romney.

If all those people were naturally inclined to vote for an unabashed conservative Barry Goldwater Romney, then they probably wouldn’t be “independent,” “centrist,” “moderate,” or a Democrat in the first place.

Well my ED had at least six votes, because I was #6; I’d be interested in finding out how many votes there were all day.

I don’t know how to find that out, although they are public records, and some people ca.

The total of 6 may have been inflated by the votes of one or two poll workers. Do you know how many people approximately are in the book?

(Since the early 1990s, we’ve no longer used the original registration cards, which used o be yellow – instead each election, the Board of Elections prints special books, which contains the list of people eligible to vote in that election. There is one line that is a facsimile of the signature line on a voter registration, and one line to sign, 6 voters on a page.)

One table had a total of 38 voters in 3 EDs – but those are small EDs – another table had 70 in one of its 3 EDs.

I found out another polling place had a total of 30 voters – a 5% turnout of those in the book (that would be 600 registered Republicans)

Much as I think my now defeated and penguin-bit former favorite could have pulled folks over to the dark side, (had he provoked less panic in his own party) using an unabashed defense of ordered liberty approach, Mitt’s best advantage has always been his potential to sooth the transition of moderates anxious to have a reasonable alternative to Obama. I hope he makes the most of it.

Rick Santorum got 19% of the vote in Pennsylvania (possibly a good result for someone not campaigning, whom people believe to have gotten out of the race.)

Newt Gingrich did not beat or come close to Mitt Romney in Delaware (it sounds like he fell victim to the oldest mistake in the book – being fooled by the enthusiasm of his crowds. Lots of people probably never even knew he was still in the race. I guess someone would say Newt Gingrich never was good at vote counting)

Newt Gingrich was 30 points behind Mitt Romney in Delaware and that’s the only state in which he came out ahead of Ron Paul.

There were 15 votes cast in one polling place and 15 in a second one and 30 (5% so 600 Republicans) in a third. Let me try a few calculations.

There are an average of 126,510 people according to the 2000 Census (in round number 125,000) in each Assembly district and 85 to 115 Election districts in each Assembly District. And 8 to 10 in a good size polling place, although sometimes there’s only 1, 2 or 3.

Say 1,250 people per ED on average.

Some below 18 (say 1/3?) some or many non-citizens, maybe half not registered. You could have about 300 to 350 voters, all told, in each election district. 8 or 9 per polling place – maybe you could reach 3,000 in the book in a November election. Votes in a Presidential election could reach around 2,000 I think. If there were 600 in one polling site, that would amount to 20% of all registered voters. The exact figures could also probably be checked and they vary according to parts of the city.

Most registered Republicans in New York City are somewhat detached from politics, and therefore probably less likely to vote in primaries – if they were to have any of them. Republicans rarely have primaries. Sometimes there some, mainly for major offices.

This was an unusual election in which there was a statewide primary in all of NY but only a Republican one. Not quite as rare as a transit of Venus but rare.

There will also probably be only a Republican primary for the United States Senate on June 26 but the House of Representatives will also be up for election.

There are a few contested Democratic primaries for the House — I’ve heard of Edolphous Town’s expanded district (now taking in Sheepshead Bay I think) and Charlie Rangel’s district, and there’s also the new one in Queens that Congressman Gary Ackerman first announced he was running in and then not.

There may be a few more or less pro forma contests as well, but I would expect any challengers will be leftists. For some reason people on the far left are far more likely to run run hopeless campaigns – that probably includes Ron Paul.

Most people familiar with New York City politics know you have to register as a Democrat to be eligible to vote in primaries, and primaries have been considered very important at least since 1969 when (thought to be too conservative) Mario Procaccino (sp?) won the Democratic primary for Mayor (and not Abe Beame) and Mayor John Lindsey lost the Republican primary for Mayor to John Marchi (he ran and was re-elected on the Liberal Party line.)

What kind of people are registered Republican in New York City?

There are old timers (I think most Italians – many Italians registered Republican decades ago – in the 1920s or earlier because, before Mussolini, there was a “Republican” Party in Italy. There was never any “Democratic” Party. That’s the original reason. Most other immigrants became Democrats.)

Some younger people, too register as Republicans.

Also Russians and Chinese are Republican much more frequently than others. They are probably paying attention only to national politics.

Some Orthodox Jews, too, have registered Republican in the last two or three decades or so.

49. This seems to show lower turnout for the Republican Presidential primary in 2012 than in 2008. Ron Paul did considerably better in Rhode Island but slightly worse in Pennsylvania, so his votes are probably affected by a perception as to how many alternatives there are.

There’s a much bigger falloff in vote total Rhode Island than in Pennsylvania, but you need to know where the presidential race was standing when each state chose its delegates. States don’t stay in the same position from election to election.

In 2008, New York voted on February 5, but this year on April 24 That created a more than 50% probability it would not be considered to matter. I don’t know who picked the date or why. The Republicans probably set the date since the Democrats didn’t care this year, and had no way to strategize about this in a way to help themselves..

It looks like maybe a few states moved together. In 2008, New York was winner take all and greatly helped McCain.

Maybe the idea was that first it should be after March 1, since you could then tilt more toward winner take all according to Republican Party rules, and this was just late enough that it could help Romney if he was in trouble (if that was the idea) by giving him some states easier to win if it devolved into a heavily contested two-man race, somewhat like Obama vs Hillary Clinton in 2008.

Usually state politicians wants to make their Presidential primary election matter. Sometimes, they want to make it not matter, so they don’t have to choose between candidates. This seems t have been some sort of a compromise.

For a long time (starting with 1976) the New York primary was in early April and it tended to matter, just a bit. It was on March 25 in 1980. It was on April 3 in 1984 (although Democrats at one point were proposing May 22), April 19 in 1988 and April 7 in 1992.

In 1996, it was pushed back to early March but also pushed ahead two days to Thursday March 7, because it would have coincided with Purim. Not a day in which religious Jews cannot work, but one in which many are busy with other things. This was probably not because it would affected the willingness to vote (in New York City and Buffalo polls on primary election days are open from 6 am to 9 pm – other places in New York State they open at noon on primary days) but the willingness of some members of political clubs to work that election day, which would have precluded them doing much of anything else from 5:30 am to about 9:30 pm (Now that they changed the election machinery people are supposed to report at 5:00 and not 5:30 and often need to stay even past 11:00 if there’s anything wrong.)

In New York State, elections always avoid the Jewish holidays of Passover (first and last two days) Shavuous (I’m not sure anything is scheduled around that time of the year anyway) Rosh Hashonah, Yom Kippur, Succos (first two days) and Shemini Atzeres/Simchas Torah – as well as the day before, which can only really happen with Yom Kippur, as few Jewish holidays can start on a Wednesday and the problem usually occurs in September.

1996 would have also seen only a Republican contest. In 2000 the presidential primary was on the first Tuesday in March.. I don’t know or remember what happened to the 2004 Democratic presidential primary. In 2008 it was set back to February 5.

If there are not at least two candidates who qualify for the ballot, there is no election.

Illinois, Pennsylvania and California (with the exception of 2008) and a few other states, have their presidential primaries on the same day as all their other primaries for the general election that year. That makes the Illinois Congressional primaries extremely early – the earliest in the nation. But then, Illinois politicians don’t really like primaries.

Comedian Jon Lovitz has had the wool pulled from his eyes. “This whole thing with Obama saying the rich don’t pay their taxes is f**king bullsh**. And I voted for the guy, and I’m a Democrat.

At least Lovitz is honest about his limousine liberalism, although I’m not sure if his history is more along the lines of a “centrist” Democrat instead of a leftwing one. He also may be merely going through the normal life changes — from left to right — that adults with at least some sanity experience as they grow older.

However, if he’s been a staunch liberal well through 2008, and originally really was a fan of Obama, but has had an epiphany of late, it will be interesting to see how many more of those are like him out there.

“I think I could probably do every job on the campaign better than the people I’ll hire to do it,” he said. “It’s hard to give up control when that’s all I’ve known.” Obama said nearly the same thing to Patrick Gaspard, whom he hired to be the campaign’s political director. “I think I’m a better speechwriter than my speechwriters,”

Wow. Yikes. If anyone has had even slight doubt as to just how absurdly voluminous are Obama’s ego, narcissism and likely hubris, that passage alone says it all. I’d give him some slack if he at least had the qualities of a true so-called Renaissance Man, or sort of a Thomas Jefferson. But President Teleprompter ain’t no Thomas Jefferson.

I’ve long thought that California should detach its legislative primaries and move them to August, to shorten the primary cycle. I think that even more now that CA has the “top two” general election system.

That said, I find NY’s *three* primaries to be bizarre. I recognize that it wasn’t intended.

Also, how is it possible that, eleven hours after the polls closed, 47 of the Bronx’s 336 precincts haven’t reported yet?

It’s not like this is a high turnout election in the Bronx. (The other 289 precincts reported a total of around 1200 votes).

There’s some problems with vote counting in the Bronx according to the New York Daily News:

(\although reading this closely, this seems actually to be about only one scanner. The people at the Board of Elections just pretended it worked, even though it gave extremely anomalous results, and tghere was no candidate to care.)

Either the voters who go to the polls at Public School 65 in the South Bronx have a high propensity for filing defective ballots, or the city Board of Elections is disenfranchising hundreds of people.

Either way, New Yorkers who did their civic duty on Election Day last year have gotten the shaft — and the board couldn’t care less.

Data uncovered by New York University Law School’s Brennan Center reveals that up to 39% of votes cast for governor in election districts served by that polling place simply vanished.

For example, 71 voters in the 23rd Election District cast ballots, but the gubernatorial votes on 28 were ruled invalid by electronic scanners.

The Brennan Center has filed a legal challenge to New York’s method of handling so-called overvotes — ballots on which a voter fills in ovals next to the names of two candidates for a single office. A scanner screen shows a confusing alert and asks the voter if he or she wants to proceed. If the voter goes ahead, the ballot in that race is disqualified.

Across the city — as well as in neighborhoods surrounding PS 65 — the rate of supposed overvoting was less than half of one percent.

Two conclusions are possible: One, citizens at this polling place made the overvoting error 100 times more frequently than other New Yorkers. Two, the scanners there ran haywire.

The Brennan folks brought their PS 65 findings to the attention of the state and city boards of elections in October. The response was a big shrug….

….As of now, though, the board refuses to check the records. Someone must. And here is another matter to be taken up by the Department of Investigation as the agency plumbs the depths of the board’s incompetence.

….Using the Freedom of Information Law, this editorial page then demanded the right to inspect ballots cast at PS 65 in the 2010 primary and general elections — the ones that put Gov. Cuomo into office.

The board complied, marking what may be the first time members of the public in New York State have been given permission to look over cast ballots and review how they were counted.

All too predictably, we discovered that voters had done their part correctly, while one of the three scanners at PS 65 misread and miscounted votes. Here are the disgraceful findings:

In the September primary, the scanner processed 103 ballots and made errors on 69 of them, a failure rate approaching 70%.

In the November general election, the scanner handled 289 ballots and misread votes on 156 of them, a 54% failure rate.

The errors occurred in identifying so-called overvotes. These happen when voters fill in two ballot ovals for different candidates in the same race, darkening one for, say, Cuomo and the other for opponent Carl Paladino.

Presented with the conflicting marks, a scanner alerts the voter with an on-screen message that gives two choices: Correct the ballot or proceed. If the voter proceeds, the machine invalidates the vote in that race. Neither Cuomo nor Paladino would be credited with a vote.

Time after time, looking at photographic images of the ballots that are recorded by the scanners, we found ballots that were perfectly filled out: one vote for Cuomo, one vote for Eric Schneiderman, then running for attorney general, one vote for Kirsten Gillibrand, running for Senate.

And, time after time, we also saw that the machine had registered overvotes where none existed. For example, detecting a valid Cuomo vote while also recording phantom votes for Paladino and for the five other lesser-known candidates, plus a write-in.

In those circumstances, the machine invalidated proper votes.

On other ballots, voters chose not to fill out an oval in a particular race — and the machine recorded that they had filled one in. For example, a voter opted to skip the contest between Gillibrand and Democratic primary challenger Gail Goode — but the scanner scored a vote for Goode.

The board and the scanner supplier, Election Systems & Software, swear the machines are accurate. Really? And that the machines are calibrated and tested before every Election Day. Really?

That’s not what happened — and the failures occurred twice. There must be a complete investigation by an independent authority that examines the faulty machine and goes far into checking on the possibility of broader undetected failures.

The Board of Elections cannot be trusted with the inquiry. It’s an outdated, unaccountable, mismanaged operation dominated by the Democratic and Republican parties. It should be put out of its misery — and the public’s — to be replaced by a professional, nonpartisan bureaucracy.

I can say that at our polling site on Tuesday, one of the scanners did not work and was not fixed still about 4 PM. At another the BMD wouldn’t boot. they also didn’t deliver enmouygh tables. Someone came over from HQ and told teh co-ordsdinator she shopuldn’t have taken one of the tables for herself. But she kept it. Eventually one place got its table – also a separate table was made available for the interpreter.

66. Sorry, Sammy, ‘bond vigilantes’ will have their say regardless of Ben. Japan has been running a current account deficit for six months and domestic ownership of their debt has fallen a few points to 93%. Italy and Spain are now paying either side of 6% for a ten-year bill. Germany just today had a failed auction, unable to sell 500 million of 3 billion.

EU liquidity is drying up again and ECB will soon do LTRO3.

True the Fed now owns 80% of everything over US 10-year bills. But even with a GOP clean sweep we’ll be adding nearly a $Trillion$ each year to the debt.

Sooo, buyers of short term notes, the bulk of US debt, will soon demand ever higher yields because the US is headed for default.

Not even the Sri Padmanabhaswamy temple in Trivandrum, India, where, over the objections of the Maharaja of Travancore, whose family used to rule much of southern India, one of two vaults that had not been opened since 1885 was opened (one of the latches to the other unopened vault was broken, and they called for a locksmith but meanwhile the royal family filed an affidavit with the Indian Supreme Court asking for it not to be opened saying it might compromise the spiritual integrity of the temple) and about $10 billion to $20 billion dollar’s worth of gold rings, bangles, lockets, chains, many encrusted or studded with jewels, loose diamonds, rubies, emeralds, other precious stones, including a solid gold body of armor for the main idol, a solid gold idol of Vishnu with hundreds of gems, and about 100,000 gold coins dating back all the way to the Romans were discovered.

Pliny the elder wrote in the year 77 that India was the world’s gold sink. (About 1,500 years later it was known as a silver sink.)

Most of that comes from a donation made in 1750 by the Maharaja of Trivandum. He was battling a bunch of rivals known as the Lords of the Eight Houses, and they were plotting to assassinate him at a festival at that temple. But they were overheard by the keeper of the well attached to the inn were they discussed their plot and he warned the Maharaja. So he showed up there with soldiers, and eventually a number of the rebels were executed, their homes destroyed, their weaslth seized and their wives and children sold into slavery. He was a very cruel ruler, according to T. P. Sankrankutty, author of the number of books on the kingdom of Travancore.

After many years, he wanted absolution so as repentance he dedicated his kingdom and his entire wealth to the temple and much of the wealth was locked up beneath the temple. His family retained real control of it. But I guess they never wanted to spend the ill-gotten gains. Or considered it holy. Some small fraction of other wealth has ben secretly removed. All this from an article by Jane Halpern in the current (April 30, 2012) issue of the New Yorker, pages 49-57.

Of course all of that is not money anyway.

And if China decided to dump all of its bonds, the Fed could handle it. And besides which who wants to destroy th3e dollar. Without the dollar there would be no reliable store of value in the world. Nobody is going to trust reminji, especially right now when we’ve been reminded of the non-rule of law in China with the Bo Xilai scandal, and the Euro, well look at the Euro.

And the bond vigilantes. Suppose they make profits. Where are they going to put all their profits, if they bring down the dollar? Are they going to get Roman, Dutch, Mughal, Napoleonic gold coins from the temple in India, supposing it was compelled to sell them? And if they do good luck trying to spend them. It’s not money. And suppose there was some idiot with money, the Fed could enlist many many people who would see a self-interest in not letting the dollar fail.

Japan has been running a current account deficit for six months and domestic ownership of their debt has fallen a few points to 93%.

So what? That’s nothing.

Italy and Spain are now paying either side of 6% for a ten-year bill. Germany just today had a failed auction, unable to sell 500 million of 3 billion. ?

Only because the European Central Bank refuses to intervene. Their policy is a failure. Austerity cannot work mathematically.

Now if Congress passes the Sound Dollar Act next year, and a President Romney signs it, and the 12 regional bank presidents all become permanent members of the Open Market Committee and Ben Bernanke is not reappointed, and the Fed is controlled by people who think like the European bankers do now, then probably there will be disaster, and they’ll blame Obama, maybe Obama together with Bush and the Congress, saying it was inevitable, but the question in 2016 will still be “are you better off now than you were 4 years ago” especially since Romney ran on the economy, and the answer will be No!

And you don’t need utter disaster for this – just higher interest rates and what that will cause, even if mitigated and reversed.

It’s not like Obama really understands anything, but the Democratic conventional wisdom on monetary policy, and the part of fiscal policy that deals with the dangers (as opposed to the chimerical benefits) of deficits and government debt, is much better than the Republican one.

one of the problems is that Obama has adopted some of the Republican conventional wisdom on deficits. He just wants to solve it with taxes, (albeit he’s honest enough to admit he would shrink the deficit very slowly) that’s all, and doesn’t understand what really creates conditions for economic growth.

Obama of course keeps on talking about raising taxes on the wealthy (excuse me, high income earners, which is not the same thing) but this is partly to stymie Republicans – any time some cut in the deficit or paying for” some expenditure is proposed, this is trotted out. The same (relatively small in revenue terms) tax increases are used over and over again in every financing dispute.

And partly because he wants to raise taxes on everybody else, but feels he can’t get away with that unless he raises taxes on the well-off. Even if it actually costs revenue, that’s how trivial the revenue in question is.

And LTR4 and LTR5 and LTR6 and LTR7. They are always behind the curve. The Long Term Refinancing isn’t enough. The European Central Bank keeps on expecting the problems to get better. They always get surprised. They are not using dynamic scoring. Their budget projections probably cannot work mathematically. The proof is in the pudding. European governments cannot raise taxes and cutting spending without shrinking the economy – and by tax increases I include also collecting taxes that people have evaded until now. The ECB is simply not willing to intervene enough directly. The Fed on the other hand, under Ben Bernanke understands that one responsibility has to be making sure the government can finance its debt without going into a death spiral.

Is that correct? I’m not even sure what you mean, though? They have 80% of the 30 year bills?

The Sound Dollar Act would still let them buy Treasury securities, but nothing else. Then they really might wind up owning most of it.

But even with a GOP clean sweep we’ll be adding nearly a $Trillion$ each year to the debt.

Sooo, buyers of short term notes, the bulk of US debt, will soon demand ever higher yields because the US is headed for default.

The U.S. is not headed for default unless somebody changes some laws. Default is not even legally possible, according to the 14th Amendment. The money will always be owed, unless inflated away.

They might want higher yields because they expect a drop in price (higher yields) which could effect even 2 year notes and also inflation.

But prices don’t have to reflect that..

During World War II, and immediately after, till October 1948, when the main problem that President Harry S Truman said the do-nothing Congress was doing nothing about – inflation – suddenly vanished by itself (it turns out that a very strong expansion also causes prices to drop because of the acceleration principle, eventually the supply curve become steeper than the demand curve and inventory control breaks down as it no longer can in a contraction * ) and Truman was re-elected.

* I concluded that in 1980. Most economists don’t attempt to explain The Inflation That Vanished. Milton Friedman says extremely low interest rates was tight money.

Where was I? During World War II and immediately after, although prices doubled between 1940 and 1948 and everybody knew it, government bonds were sold at very low interest rates. The Fed kept interest rates on government bonds very low (And other interest rates too of course because there can be only one market price)

It regained its independence on March 4, 1951.

We then had several recessions during the 1950s, and on December 5, 1966 I think it was – I need to check the date – the Fed decided to fight inflation and the result was the most prolonged inflation we had ever had They had already begun raising interest rates slightly since 1964. It’s amazing how inflation always kicks in just when the Federal Reserve Board decides to fight it.

Proof is coming by September in another S&P downgrade of America

What caused the previous downgrade was not any idea of an inability to refinance or pay the debt. It was infighting in Congress that caused a delay in raising the debt ceiling. That created the only danger of default. It was Michelle Bachman and the Tea Party who caused the downgrade – make no mistake about it.

The United States government is not a corporation, it is not a state like California or Illinois, , it is not like any other country – it is not a foreign government.

The ordinary laws of economics do not apply to the United States government, and may it ever be this way, although it won’t.

That is American exceptionalism, and in this regard, it seems to be some conservatives, who want to take the United States down a notch. Or pretend we are just like any other country.

Sammy – congrats on inventing the “Maze o’ Text” ! Not satisfied with overachievement in the field of “Wall o’ Text”, you have exceeded expectations … and you have managed to do so without corroborative links …

Yes, he thinks, or more exactly, was told, it is a good idea to do this to balance the budget or put it closer to balance – and he wants to raise taxes on the wealthy – excuse me, high taxable income reporters – because he thinks it is necessary to do so for him to be able to propose raising taxes on everybody else, or cutting entitlements. Of course, for starters, sometimes he pretends the tax increase on the upper brackets is all he would need to do.

and it doesn’t matter as he admitted to Gibson, that cutting the rate raises
revenue,

Yes, because the idea is everybody should chip in chip in to reduce the deficit. This he calls fairness.

By the way, there’s hardly a more regressive “tax” than the individual mandate to buy health insurance. Not only is there a cap – a maximum, but the amount everybody must pay is equal, unless you can plead poverty – and anyone at the margin of course would face steep marginal tax rates. And you’re suppose to pay back Medicaid if you ever get any money.

“the Democratic conventional wisdom on monetary policy, and the part of fiscal policy that deals with the dangers (as opposed to the chimerical benefits) of deficits and government debt, is much better than the Republican one.”

SF: “the Democratic conventional wisdom on monetary policy, and the part of fiscal policy that deals with the dangers (as opposed to the chimerical benefits) of deficits and government debt, is much better than the Republican one.”

Comment by daleyrocks — 4/26/2012 @ 2:26 pm

Sammy – Absolutely. Just look how well it’s working.

No real crisis – very good. No real recovery, because bank lending has slowed down, and that hasbn’t been dealt with. And we could say, the fed is still too cautious.

Now what Obama primarily relied on was Keynesian economics. Which meant governmenmt spending and he bought the idea it was so important to spend money, it didn’t matter where it went so instead of funding ideas people had had for years that might do some good, he just threw it out the door (and also used it to shield state and locval govewrnment workers from the recession)

It didn’t work. But quietly there was also some monetary stimulus going on. One problem is banks were regulated in such a way that not too much newe lending took place.

The part of Obama’s fiscal ideas about raising taxes has not been implemented and I wasn’t talking about that part, and balancing the budget is anyway a Republican idea. When Democrats sign on to that idea they always want to do it by raising taxes.

It’s some ideas popular amomng Republicans that are really terrible.

Raising interest rates and attempting to balance the budget would precipitate a crisis. Newt Gingrich had sort of the right idea: We need economic growth. You can’t balance the budget without it, And with it, you don’t need to do anything special. What seems to be a bit popular now is what Jack Kemp called “root-canal economics.”

Tax cuts were one way to stimulate growth but Kemp and his friends loved growth so much that they were willing to push it via the printing press. Thus did they develop an inadvertent Keynesian-style aversion to high interest rates and instead constantly egged on the Fed to pump more money.

One thing wrong with that sentence is that Keynesian economics is not low interest rates.
It’s government spending, which is basically worthless in stimulating an economy and people knew that already in the recession of 1974-5 but Congress went ahead anyway with a tax rebate.

Root Canal economics was most strongly advocated and carried out by Jimmy Carter in 1979-80. It’s otherwise never really been tried because it’s politically impossible – but you can get closer to it. Eisenhower did that a bit.

Now what I don’t believe is that lower taxes would do too much, because much new businesses are financed by loans and not savings, although some saviongs must be present.

The part of Obama’s fiscal ideas about raising taxes has not been implemented and I wasn’t talking about that part, and balancing the budget is anyway a Republican idea. When Democrats sign on to that idea they always want to do it by raising taxes.

Not yet anyway. (Actually it is possible to sell at below 0% but not too much is being done in that regard. Who says the minimum rate has to 0%? People will buy Treasuries even at negative interest rates? You couldn’t borrow at below 09%, but the U.S. Treasury can and has. There’s something to be said for security)

Uncle Sam is paying an average interest rate of 2.24%. The government expects to spend in the neighborhood of $225 billion this year making interest payments…

… As recently as early 2007 the government was paying 5% on its debt, which is the average of the last two decades, though of course rates could always go higher. During the 1990s, the average was well above 6%.

If, if if but only if – the government were paying 5%, not what it pays now, THEN it would $500 billion.

Perhaps Romney would like to double the amount of the interest payments the government pays on the debt?? Half of which or more which Obama has run up – he has run up but it is there and it can’t be wished away.

If it went up to 6% the annual interest payments won the debt would be $642 billion.

Here’s the situation:

…the U.S. Treasury currently has $10.7 trillion in outstanding publicly-held debt, and more than $8 trillion of it must be repaid within the next seven years. More than $5 trillion falls due within the next 36 months.

This relatively short-term debt sheet is no accident. Like a subprime borrower opting for a low teaser rate, the government has structured its debt to keep current interest payments low.

This is a political temptation for every Administration because it means lower budget deficits on its watch.

The Obama Administration has added close to $5 trillion to the U.S. debt. So it much prefers to finance all of this at a rate, say, of 0.3% in two-year notes than at 2% in 10-year notes. The nearby charts show how federal debt has soared during the Obama years, yet net federal interest payments are lower than they were in 2007 and lower than they were in nominal dollars even in 1997 when public debt was a mere $3.8 trillion. This year the debt is expected to reach $11.58 trillion….

Putting too much pressure on a president to balance the budget is precisely the WRONG thing to do. The debt needs to be refinanced, even at a higher rate.

Best would be 60, 100 even perpetual bonds. The interest rate won’t be much higher on them than on 30 year bonds.

Or tight control needs to be maintained over the Fed so the low rates stay until the debt has been grown out of or inflated away (like the World War II debt was)

The way things are now it is a time bomb. We dare not let interest rates go up, and that’s not too good a situation to be in. It’s even worse if you don’t even recognize that that’s the situation we are in.

Lowering the nation’s rating to one notch below AAA, the credit rating company said “political brinkmanship” in the debate over the debt had made the U.S. government’s ability to manage its finances “less stable, less effective and less predictable.” It said the bipartisan agreement reached this week to find at least $2.1 trillion in budget savings “fell short” of what was necessary to tame the nation’s debt over time and predicted that leaders would not be likely to achieve more savings in the future.

They only mentioned something about taming the debt because that was the cause of the political arguments. It wasn’t a real solution, ergo, this could happen again and that time the government maight actually miss a payment if a poresident wanted to do so.

S&P engaged in a bit of double talk around that time but it was clear that the cause was the political deadlock and not anything about the size of the debt.

“No real crisis – very good. No real recovery, because bank lending has slowed down, and that hasbn’t been dealt with. And we could say, the fed is still too cautious.”

Sammy – Very nice job of minimization. Weakest economic recovery in U.S. history. Record number of people on food stamps or other government assistance. Look at number of people leaving the work force and unemployment or underemployment stats. Obama has created a cloud of uncertainty hanging over the economy with a series of short-term actions, most have which have served to stifle recovery, including a huge number of unneeded new regulations.

We can take the UK’s example as a counterexample of how to make it worse, the new Tory/Lib Dem coalition imposed higher tax rates, and subsequently tanked the economy, there was some cut
back in spending, but most adverse measures like this. as well as a round of qualitative easing.

narciso – The point about banks not lending is especially funny to me given that Obama had regulators looking over the shoulders of banks so closely early in his tenure ready to pounce on them at any hint of a risky new loan. He essentially created the conditions for banks to avoid new lending risks. There should be no surprise about it.

Energy is another area in which Obama policy has had a major negative effect on the economy.

The crowding out effect of government spending and borrowing is not factored into Sammy’s analysis.

SF “If the size of the debt grows no more than the size of nominal GDP, then this can go on indefinitely and we are in orbit.”

Comment by gary gulrud — 4/27/2012 @ 12:02 am

News flash, the debt is already larger and growing at a far more rapid rate.

I know it’s growing faster than that. The point is that an annual deficit of about 3% of GDP, or about $450 billion a year, is basically a stable situation, and can be sustained indefinitely. It doesn’t need to be balanced.

$450 billion a year is somewhat around what the cost of interest on the debt is, or what it would be if it was all rolled over into perpetual bonds.

A fixed rate of 3.4% is barely above the 3.1% that the Treasury is now paying on the 30-year bond, and not far above the 1.9% on the 10-year. If some Federal Reserve governors get their way and inflate the government out of its debts, triggering a sharp rise in interest rates, taxpayers could be losing even before the defaults roll in.

If 10 year bonda are sold at 1.9% and 30 years at
3.1% then probably even a 60 or 100 year bond won’t go for much above 4% a year.

“No real crisis – very good. No real recovery, because bank lending has slowed down, and that hasbn’t been dealt with. And we could say, the Fed is still too cautious.”

Comment by daleyrocks — 4/26/2012 @ 5:50 pm

Sammy – Very nice job of minimization. Weakest economic recovery in U.S. history. Record number of people on food stamps or other government assistance.

That’s basically the same statistic, except that any kind of subjectively determined entitlement is growing. This is a problem.

Look at number of people leaving the work force and unemployment or underemployment stats.

These statistics should be broken down a little bit more.

Obama has created a cloud of uncertainty hanging over the economy with a series of short-term actions, most have which have served to stifle recovery, including a huge number of unneeded new regulations.

That may be so a little bit with regulations – and don’t forget the tax uncertainty. But people (and banks considering loans and possible partners) really look at general propects and how much money they have.

Its not psychological, any more than it was in 1930. There’s probably an actual shortage of money to invest.

103. Your reading of the quote is ridiculous, absurd. No effort is being made to reduce the deficit and debt. That is the cause of downgrade.

No, it’s not. The only reason efforts to reduce the size of the deficit or debt had any importance at all in regards to the credit rating was that Congress was in turmoil over it.

Because it wasn’t being resolved, that meant the turmoil would continue.

Therefore, the debt limit might not be raised in a timely manner the next time, and possibly, just possibly, a President might decide to miss a payment. The political infighting in Washington showed signs of getting worse with time.

That was the problem.

Of course the whole rating was irrelevant anyway. Nobody needs a credit reporting agency to tell them what to think about U.S. Treasury securuties. Why were they in the business of rating that anyway?

Their mandate is to advise investors on the quality of the investment, i.e., the value of a US T-Bill will go down following purchase.

No no. The value could easily go down if interest rates go up. If that was the basis for the rating anything past one year or two should not be rated investment grade.

They said nothing about interest rate risk.

Their job is only to talk about credit risk – the possibility of an interest rate payment, or the final payment, not being paid on the day it was due. A delay even for one day would be a very significant event.

Buyers of Greek debt today can expect to lose 80% of their investment, America’s debt is still a ‘good’ deal in comparison.

Yes. And is there any country in the world that would be a better risk? Would it still be a better risk if something happened to the dollar? Would they allow people to convert their currency?

narciso – The point about banks not lending is especially funny to me given that Obama had regulators looking over the shoulders of banks so closely early in his tenure ready to pounce on them at any hint of a risky new loan. He essentially created the conditions for banks to avoid new lending risks. There should be no surprise about it.

this also happened in 1989, under the first Bush, although there it was Congress passing legislation after the Savings and loan scandal
(actually manybe Reagan might have signed that bill) and the Federal Reserve Board regulating the banks.

that is when interest rates on savings accounts dropped very low. It took a long time for the fed to reduce interest rates enough for the economy to start growing again. It did, and then Bill Clinton built oin the confusion that people had about the word “recession” It is commonly used to mean both the drop and regain, but technically it only means the drop.

Energy is another area in which Obama policy has had a major negative effect on the economy.

How can it be major? It takes years for things to go online.

The crowding out effect of government spending and borrowing is not factored into Sammy’s analysis.